Kommunalkredit Austria AG, the nationalized municipal lender Austria plans to sell, reported a full-year loss because of Greek writedowns.
The bank’s net loss after minorities was 148.8 million euros ($197 million), compared to a profit of 24.6 million euros a year earlier, the Vienna-based company said today in its annual report. Kommunalkredit had a writedown of 176.3 million euros on Greek government bonds, according to the report. The bank on March 9 had warned of a 140 million-euro net loss on Greece.
Austria, which has owned Kommunalkredit since 2008, when the bank was nationalized to avoid a collapse when liquidity dried up, in November decided to sell the lender again. Since its nationalization, the bank was split into the municipal lending unit and KA Finanz AG, a “bad bank” that took on securities, loans and credit default swaps that are not part of that main business business and is winding down those assets.
“After 2011 results that were substantially impacted by the restructuring of Greek government bonds, an item which couldn’t be compensated by better-than-planned operating results, Kommunalkredit expects positive results for 2012,” the company said in the report.
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